US expats in the UAE join to force the end of FATCA

American expatriate professionals living and working in the UAE are joining together to force the end of the hated FATCA dual taxation regime.

The new law, passed in the US Senate 10 years ago, forces overseas banks to report on assets held by US expats living outside the country. Supposedly aimed at reducing tax avoidance, the measure has caused major issues amongst American expats worldwide, including rejection by retail banks in their country of residence due to the swinging penalties applied should an overseas bank fail to comply or make a mistake.

According to a spokesperson from Democrats Abroad, FATCA is a global anomaly and should be reformed. At the same time, a former chair of the UAE chapter of Republicans Overseas admits progress on cancelling the law has been slow, adding he believes Trump will dump it should he get re-elected late this year. Some nine million USA expats are living overseas, not counting the large numbers of ‘accidental Americans’ who were born in the country to expat parents and are therefore considered as US citizens even although they left at a very early age.

Expats in both categories are increasingly opting to renounce their citizenship, an expensive option costing $2,350 and requiring the filing of six years’ back taxes, but it’s far cheaper than enduring taxation on their global incomes throughout their working lives overseas. Campaigners in the UAE still believe change is possible, especially as the USA along with Eritrea are the only two world countries to impose the system on their expatriates. Even so, the American public as well as the majority of senators seem to lack an understanding of the devastating effect the law has on US expat citizens or, perhaps, simply don’t care.